Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please help me to do b,c,d (or as many you know how to do). I have found out A = 0.0000484. Need help TT 2.
Please help me to do b,c,d (or as many you know how to do). I have found out A = 0.0000484. Need help TT
2. Using data from the World Development Indicators to find out the real GDP per capita of the United States and that of China in 2019. Suppose that the United States and China have the same production function, savings function, and law of motion for physical capital, as follows: Yus = A(K45)1-a (Ls)a and Y_ch = A(KEN) 1-a (Leh)a sus = oyus and Sen = orch K4s1 = (1 - 8)Kus + lus and K = (1 - 5)(c+ + Ih, where Y, denotes output, Ke denotes the stock of physical capital, Ldenotes population, St denotes savings, and I denotes investment. The superscripts us and ch denote, respectively, the United States and China. Suppose that the parameters A, a, o, and 8 are the same in the United States and China. In particular, assume that a = 0.7, 0 = 0.25, and 8 = 0.1. b. Given the information above, calculate the 2019 capital to labor ratios in the United States and China, Kch and in 2019. Lus The C. What is the average wage in both countries predicted by this model? Do you find the prediction of the model acceptable? d. Suppose there is no international trade and government in this economy, what are the real GDP per capita in both countries in 2035, based on the prediction of this model. 2. Using data from the World Development Indicators to find out the real GDP per capita of the United States and that of China in 2019. Suppose that the United States and China have the same production function, savings function, and law of motion for physical capital, as follows: Yus = A(K45)1-a (Ls)a and Y_ch = A(KEN) 1-a (Leh)a sus = oyus and Sen = orch K4s1 = (1 - 8)Kus + lus and K = (1 - 5)(c+ + Ih, where Y, denotes output, Ke denotes the stock of physical capital, Ldenotes population, St denotes savings, and I denotes investment. The superscripts us and ch denote, respectively, the United States and China. Suppose that the parameters A, a, o, and 8 are the same in the United States and China. In particular, assume that a = 0.7, 0 = 0.25, and 8 = 0.1. b. Given the information above, calculate the 2019 capital to labor ratios in the United States and China, Kch and in 2019. Lus The C. What is the average wage in both countries predicted by this model? Do you find the prediction of the model acceptable? d. Suppose there is no international trade and government in this economy, what are the real GDP per capita in both countries in 2035, based on the prediction of this model
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started